In the neighboring country, the vehicle fleet is getting older and averages around 14.1 years. Models available in Chile are 30% to 50% cheaper than the affordable lightweight models that lead sales in Argentina.
Just as clothing, footwear and technology are the products most in demand by trans-Andean people every time they enter Chile, even in the winter season with snow in the mountain ranges, there are also two other historical attractions: the automobile and the updating of the circulating fleet. Although this is not something that a tourist acquires during his trip, it is a wonder to see it The cheapest light vehicle in Argentina is 35% more expensive than in ChileWhere the wide range of Japanese brands (mainly Toyota and Suzuki) make a difference.
Unlike Argentina or Brazil, Chile’s economy is characterized by low import duties and not having its own automotive industry. This scenario has led Asian brands to dominate the automotive market, offering low prices in dollars.
During the month of June, 29,878 vehicles were patented in Argentina, 14.1% less than in May and 25.5% less than in June 2023. in the same period of 2023, as reported in its latest report Association of Automotive Dealers of the Argentine Republic (Program).
In comparison, National Automotive Association of Chile (ANAC) indicated that 22,567 units were sold in Chile in June, which represents a decline of 0.5% compared to the same month last year. New vehicle sales fell 10.5% compared to the first half of this year, with 142,486 patented units at the end of June.
But the striking thing is that the more than 22 thousand sold in Chile, only 24% less than the almost 30 thousand in Argentina, come from a country with just over 17 million inhabitants compared to 46.2 million in Argentina, a demographic market almost three times smaller. Not to mention the territorial area.
Cars more expensive in Argentina than in Chile
For the calculations, it should be taken into account that the dollar is trading around 940 Chilean pesos, remaining relatively stable. In the Argentine examples, the price of the parallel, free or “blue” dollar is taken, which, after a significant increase in the first half of July, is 1,450 Argentine pesos for each North American bill. This is the exchange rate that savers access in the so-called “caves” (illegal). If the calculations were made with the official one, which is what automotive companies use when importing, the values would be even higher.
Fiat Mobi Trekking
According to data provided by Aqara, the cheapest 0 km light vehicle in July is the Fiat Mobi Trekking, which was relaunched after being discontinued in 2022. It costs 19,005,000 Argentine pesos, but This is available only in installment savings plana system still in place on the other side of the mountain range. The total cost is equivalent to $13,107 (12.4 million Chilean pesos).
In Chile, the Suzuki Alto is the cheapest on the market and is available today for 7.9 million pesos with the brand bonus, i.e. $8,500. Thus, the difference in the aspirational “floor” for new cars between Argentina and Chile is 35%.
suzuki alto
While the minimum wage in Argentina is around $175 (254,231.91 Argentine pesos), in Chile it reaches $532 ($500,000). To buy an affordable new car, an Argentinian would need 75 minimum wages, while a Chilean would need 16 minimum wages,
The Toyota Yaris, whose most accessible level is the Like, costs 20,292,000 Argentine pesos, which is equivalent to $13,994. By comparison, the same model sells in Chile for a slightly more expensive 14,351 US dollars ($13,490,000). However, this is hardly an exception to the norm.
If we look at the ranking of best-selling light vehicles during June in Argentina, the Fiat Cronos sold USD 14.404 (ARS 20,886,000) and Peugeot 208 sales USD 14.796 (ARS 21,454,700). In the Chilean sales list reported by ANAC, cheaper alternatives such as the Suzuki S-Presso appear USD 8.926 ($8,390,000), L Kia Morning A USD 9.883 ($9,290,000) and Kia Soluto 10.415 US Dollars ($9,790,000).
Regarding SUV vehicles, the preferred choice for families, in Argentina the Chevrolet Tracker (of Argentine origin) is the cheapest model and cost USD 20.155 (ARS 29,224,900), while in Chile you can pick up a Chevrolet Groove (of Chinese origin) for almost half the price, only USD 12.223 ($11,490,000).
Chevrolet Tracker (above) and Chevrolet Groove (below)
Argentina’s automobile fleet will continue to age
The vehicles on Argentina’s roads and avenues average, 14.1 yearsAccording to the latest annual report published this week by the Argentine Component Manufacturers Association (AFAC), which includes analysis until December 2023. In Chile, the average national aging rate is 9.4 years (2022), the youngest on the continent.
Data that reveals vehicle aging is that only 449,438 0km cars were sold last year, or double the total increase in units, from 15,079,041 to 15,299,751 vehicles from 2022 to 2023. That is to say, the circulating fleet in the neighboring country consisted of more old or used ships.
To reverse this poor outlook in terms of loss of purchasing power, AFAC considers that 1,250,000 new vehicles per year must be added, a far cry from the current sales parameters of 0 km. Everything indicates that vehicle age will continue to increase.
Unlike Chile, Argentina has a notable predominance of European brands: 62%. 26% of the vehicle fleet is American, while only 12% comes from Asia.
Savings plans in Argentina, a case study in the world
In Argentina, it is estimated 40% of the 0 km cars sold are compliant with savings schemes, A quota system for about seven or eight years, which is not seen as much in other parts of the world.
For this payment method, closed groups of 168 savers are created who receive two cars per month: one by lottery and the other by bidding. The net fee is defined by the price of the cars divided by the months of the plan. But price fluctuations and, in recent years, several precautionary measures by the Argentine Department of Justice prevented excessive increases, forcing people to abandon their dreams and Sell your plan at a market value lower than the amount invested,
so, The Argentine has been paying for seven or eight years without a car or they hand it over to him and he continues payingBut they are completing the instalments with a seven or eight year old vehicle.
After the obstacles of the previous administration and the delays in deliveries due to the shortage of dollars, at the beginning of the government of Javier Mieli, the import permits (the Import System of the Argentine Republic, known as SIRA) were abolished in order to speed up the process of recovering the flow of payments from factories abroad. However, the immediate delivery of vehicles to dealerships is still missing.